Nonprofit developer and lender launches construction of $3 million condo development

Project aimed at families that make too much to qualify for low-income housing subsidies, not enough to afford market rates

Oakland Housing looking to work with others to develop, finance housing

Steven C. Flum Inc.

The two-bedroom units in North Pine Street Townhomes in Detroit's North Corktown will average 1,500 square feet with three-story elevations, attached garages, outdoor art installations and tree farms.

A nonprofit developer founded in the wake of the Great Depression to create housing affordable for autoworkers, has been quietly developing and financing affordable housing for the middle class in Oakland County for decades and, more recently, in Detroit.

One of the biggest challenges nationally and in Detroit is that construction costs are rising faster than incomes, and that's pricing middle-income people out of homes, Oakland Housing Executive Director Kate Baker said.

There are government programs to help low-income people get into home ownership, she said. Those programs assist people who earn 80 percent or less of area median income. Oakland Housing provides housing and financing targeted to people earning 80 percent-120 percent of median income to ensure mortgages for homes in desirable areas are affordable.

"The people in the middle are squeezed. Their incomes are too high to qualify for rental subsidies but often not high enough to buy quality housing near where they work," Baker said.

Kate Baker

"We want to keep you near work, in a great neighborhood," she said, while also helping to build generational wealth for middle-income families through home ownership.

Oakland Housing targets "opportunity neighborhoods" near good schools and employment centers, where prices are rising so homeowners can build equity, Baker said.

Founded in 1935 by James Couzens, a former Detroit mayor and U.S. senator, Oakland Housing completed its first community development in 1936 in West Bloomfield. Since then, it's helped develop a total of 250 homes in Pontiac, Rochester Hills, Troy and Detroit where it built seven homes over the past 15 years with Slavik Building & Development in Woodbridge Estates, about a mile north of its new development site.

Oakland Housing broke ground in April on the North Pine Street Townhomes development in North Corktown, just north of the Michigan Avenue business district and two blocks north of Michigan Central Station. The project is a block north of I-75 on Pine Street, between Rosa Parks Boulevard and 14th Street. Baker said she expects people to be moved into the homes by year's end.

The nonprofit developer is working with the North Corktown Neighborhood Association and the Corktown Business Association to spread the word about the new homes that it will finance for middle-income earners. Already, it's secured pre-sale commitments for five of the 14 townhomes — three from renters in the neighborhood, Baker said.

Detroit-based Steven C. Flum Inc. is project architect and Pontiac-based West Construction Services is general contractor.

The property sits on about a quarter of the 4 acres Oakland Housing has acquired in North Corktown along Pine Street, between Vermont and Wabash, over the past dozen years, she said. The nonprofit developer is working with neighbors in the area as it makes plans for the other property.

Baker said there is interest in open space and farm space, so Oakland Housing hasn't made any plans for another development for middle-income earners in the neighborhood at this point.

Over the past 85 years, the nonprofit has built up a $10 million reserve from market returns and people paying back mortgages at low interest rates, Baker said. It's looking for additional opportunities to make quality housing affordable for middle-income earners in North Corktown, whether as a builder or mortgage lender, she said.

"We're looking for interested and creative developers to help us figure out how to best use our funds to get middle-income housing developed, or included in other projects," Baker said.